Value and process of Holds on Credit Cards
When a Customer books a Reservation or Event, the system will put a hold on the Customer’s credit card (cc) to ensure the Customer has the necessary funds in their bank account.
The value in putting a hold on the Customer’s cc is multi-fold:
A hold reduces the need for refunds
There is a Stripe Fee when processing Customer transactions, and if a Customer is charged upon signing up for an Event or booking a Reservation, should the Customer cancel, the Stripe Fee is lost during refund
A hold increases the ability to bundle charges
The Customer is charged after an Event or Reservation so the PodPlay system can Bundle Charges. Suppose the Customer makes any additional charges during the Reservation, like purchasing something from the Club’s Shop, paddle rentals, or mistaken destruction of Club property. In that case, the PodPlay system wants to bundle those charges into one charge.
The different scenarios when the system will put hold on the Customer’s cc are as follows:
If a Customer signs up for something <6 days in advance (within a week), Stripe immediately puts a hold on their cc
If a Customer signs up for something >6 days in advance (more than a week out), Stripe waits to put a hold on their cc, and then puts a hold on their cc 24 hours before the Event or Reservation
The reason for the delay in placing a hold on the cc is the legal classification of the product type: sports entertainment, which states that holds on a cc cannot be pending for more than 7 days
To learn more about when the cc hold fails, read about: